G.R. No. 236498 , September 16, 2020
Trans-Global Maritime Agency, Inc., et al. vs. Magno T. Utanes

FACTS

Respondent Magno T. Utanes was hired as an Oiler by petitioner Trans-Global Maritime Agency, Inc. He passed his Pre-Employment Medical Examination (PEME) and boarded the vessel in November 2014. During his contract, on January 25, 2015, he experienced severe chest pain, dizziness, and weakness. He was eventually repatriated on May 18, 2015, and underwent treatment for coronary artery disease with the company-designated physicians. After five months, his treatment was discontinued. He then consulted an independent cardiologist, who declared him permanently and totally unfit for sea duty, prompting him to file a complaint for disability benefits.
Petitioners opposed the claim, alleging Utanes deliberately concealed his pre-existing coronary artery disease. They presented evidence that during his PEME, Utanes denied any history of heart disease or high blood pressure. It was only during treatment in September 2015 that he disclosed a prior 2009 diagnosis and a previous surgical procedure for the same condition. Petitioners argued this concealment disqualified him from any compensation under the POEA-SEC.

ISSUE

Whether Utanes is entitled to permanent total disability benefits despite his alleged concealment of a pre-existing illness during his PEME.

RULING

The Supreme Court granted the petition, reversing the rulings of the Court of Appeals and the labor tribunals. Utanes is not entitled to disability benefits due to his willful concealment of a pre-existing condition.
The legal logic is anchored on Section 20(E) of the 2010 Philippine Overseas Employment Administration-Standard Employment Contract (POEA-SEC), which explicitly disqualifies a seafarer from compensation and benefits if he “knowingly conceals a pre-existing illness or condition in the PEME.” The contract defines a pre-existing condition to include a situation where the seafarer had prior medical advice or diagnosis and knowledge of the illness but failed to disclose it during the PEME, provided it could not be diagnosed during that exam.
The Court found that Utanes had prior knowledge of his coronary artery disease, having been diagnosed and having undergone a Percutaneous Coronary Intervention in 2009. His act of ticking “No” in the PEME form regarding heart disease and high blood pressure, despite this medical history, constituted deliberate concealment. This misrepresentation was material, as it allowed him to pass the PEME and secure employment. The subsequent provision of medical treatment by the company did not constitute a waiver of the defense of concealment, nor did it imply an admission of compensability. The right to disability benefits is contractual and conditional; by violating the fundamental condition of full medical disclosure, Utanes forfeited his entitlement to claim such benefits. The failure of the company-designated physician to issue a final assessment within the 120/240-day period becomes immaterial when the claim is barred from the outset due to the seafarer’s fraud.